No. 92-022 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

1992 

AMERICAN STATES INSURANCE 

COMPANY, 

Plaintiff and Respondent, 

SUSAN WILLOUGHBY, MARK T. 

NIELSEN and JOHN GEERING, 

Defendants and Appellants. 

APPEAL FROM: District Court of the Thirteenth Judicial District, 

In and for the County of Yellowstone, 

The Honorable William J. Speare, Judge presiding. 

COUNSEL OF RECORD: 

For Appellants: 

James P. Healow, Sweeney & Kealow, Billings, Montana 

For Respondent: 

Guy W. Rogers, Anderson, Brown, Gerbase, Cehull, 

Fulton, Haman & Ross, Billings, Montana 

Submitted on Briefs: June 11, 1992 
Justice R. C. McDonough delivered the Opinion of the Court. 

Defendants appeal from the decision of the Thirteenth Judicial 

District, Yellowstone County, granting Plaintiff's motion for 

summary judgment and denying Defendant's motion for summary 

judgment. Plaintiff, American States, had requested a declaratory 

judgment stating that it did not have to indemnify or defend 

Defendant, Mark Neilsen, in two civil actions because the acts 

committed by Neilsen were not covered under his American States 

insurance policy. We affirm the District Court. 

There are two issues on appeal: 

I. Did the District Court err in granting summary judgment to 

Plaintiff because it ruled that Neilsen's actions were not covered 

under his American States policy? 

11. Did the District Court err in concluding that Neilsen had 

the burden of proving the reasonableness of the settlements with 

Willoughby and Geering? 

Mark Neilsen attended the automobile races at Yellowstone 

Belaro Speedway with his wife and friends. Sometime during the 

evening, security guards received a complaint about Neilsen's 

behavior. Shortly thereafter, two security guards, Susan 

Willoughby and John Geering, entered the area where Mark Neilsen 

and his party were sitting. Susan and John observed Mark Neilsen 

being disruptive and approached him to request that he quiet down 

but he refused to change his behavior. 

A physical altercation followed between Neilsen and Willoughby 
when Neilsen pushed or fell on Willoughby and they both fell to the 

ground. John Geering approached the two on the ground and 

attempted to assist Susan. Eventually, Mark Neilsen's wife, Joe 

Gonzales, the security guard supervisor, and a friend of Mark's 

joined the melee. Ultimately, Mark was restrained and taken under 

the grandstand where he created another disturbance, tussling with 

Deputy Sheriff Ellis and damaging a police vehicle before he was 

subdued and placed inside the vehicle. 

Susan Willoughby and John Geering sustained injuries during 

the altercation and both went to the hospital following the 

incident. Willoughby complained of a sore back, sore leg, and 

swelling and a cut on her leg while John Geering was treated for 

three bites from Neilsen sustained during the scuffle. Neither 

party required hospitalization although Ms. Willoughby obtained a 

prescription. 

Criminal charges against Mark Neilsen followed the incident. 

Mr. Neilsen was charged with three counts of misdemeanor assault 

against Susan Willoughby, John Geering and Deputy Sheriff Ellis. 

Mr. Neilsen pled guilty to these charges as well as to one count of 

criminal mischief for damage to the police vehicle. 

Susan Willoughby and John Geering filed actions against Mark 

Neilsen for damages incurred during the incident at the Speedway 

and Neilsen sought indemnification from his insurance company. 

Neilsen's insurance policy with American States provided that 

it would: 
pay up to our limit of liability for the damages.. .and 

provide a defense at our expense ... if ... a suit is brought 

against an insured for damages because of personal 

injury ... caused by an occurrence to which this coverage 

applies .... 

The exclusion provision of the policy states that coverage 

does not apply to bodilv injury ... which is ex~ected or intended by 

the insured. In addition, this provision states that the exclusion 

"does not apply to an act committed by or at the direction of the 

insured not intended to cause serious bodilv injury ....( Emphasis 

original.) 

The word "occurrence" in the policy means an accident, 

including exposure to conditions, which results, during the policy 

period, in. . .personal injury. [Plersonal injuryo1 means bodily 

injury .... 

A procedural history of two underlying cases will clarify the 

present case. On May 9, 1989, Defendant Susan Willoughby filed an 

action against Mark Neilsen for personal damages for assault and 

battery. The complaint was later amended to include a count of 

negligence. Neilsen tendered the defense of this action to 

American States requesting that it provide a defense and 

indemnification of any damages awarded in the Willoughby action. 

American States offered to provide a defense for Mr. Neilsen under 

a reservation of rights. 

Subsequent to this arrangement, Neilsen entered into a 

settlement with Susan Willoughby for $25,500 without the knowledge 

or consent of American States. Neilsen assigned his rights under 
the policy to Susan Willoughby in satisfaction of the settlement 

agreement. 

John Geering filed his action against Mark Neilsen on May 29, 

1991. Virtually the same sequence 05 events followed in this 

action and ultimately, Neilsen entered into a similar settlement 

agreement with Geering, assigning his rights under his insurance 

policy without American State's knowledge or consent. 

American States filed the present action for a declaratory 

judgment that it did not have to indemnify or defend Neilsen in 

either of these actions. The District Court granted summary 

judgment to American States. 

Summary judgment is only proper under Rule 56(c), M.R.Civ.P., 

where the record discloses that no genuine issue of material fact 

exists and the moving party is entitled to judgment as a matter of 

law. New Hampshire Ins. Group v. Strecker, (1990), 244 Mont. 478, 

480, 798 P.2d 130, 131. 

I. 

Did the District Court err in granting summary judgment to 

Plaintiff because it ruled that Neilsenls actions were not covered 

under his American States policy? 

American States contended that Neilsenvs actions were 

intentional acts and thus excluded from coverage under his 

insurance policy. If the company was liable for his actions, then 

American States argued that the settlement agreements were 

unreasonably high and that Neilsen had the burden to prove they 
were reasonable, 

However, the Defendants contended that ~eilsen's actions 

resulted in unintended injuries and were therefore accidental. 

They argued that accidental injuries fell within the coverage of 

the insurance policy and the exclusion provision in the policy was 

not applicable. 

The District Court concluded in its opinion that "Neilsen1s 

actions against Willoughby and Geering were deliberate .... Thus, 

Nielsenls American States Insurance policy does not cover the acts 

he committed against Willoughby and Geering.It Judge Speare also 

stated that whether Neilsen intended to seriously injure Willoughby 

and Geering was a question of fact to be decided by a jury. 

However, since he found that the insurance policy did not cover 

Neilsents actions against Willoughby and Geering, there was no need 

to bring this issue to the jury. Finally, he concluded that 

Neilsen had the burden of proof to show that the settlements with 

Willoughby and Geering were reasonable. 

The court reviewed deposition testimony from Willoughby, 

Geering, and witnesses Sheryl Wetsch and Michelle McKinney, that 

Neilsen refused to cooperate with the security guards and entangled 

several people in a physical altercation. These witnesses reported 

his kicking, hitting and biting people who were attempting to 

restrain him, including Willoughby and Geering. Evidence that Mr. 

Neilsen pled guilty to three counts of misdemeanor assault gave 

additional support to the District Court's conclusion that 
Neilsen's acts were intentional and not accidental. Strecker at 

480-481, 798 P.2d at 131. 

Actions such as biting, kicking and hitting are similar to 

those involved in Mutual Service Cas. Ins. Co. v. McGehee, (1985), 

219 Mont. 304, 711 P.2d 826, wherein Mr. McGehee struck a coworker 

in the face twice and the victim sought damages for his injury. 

Mr. McGehee attempted to have Mutual Service indemnify him under 

his insurance policy but the company said his actions precluded 

recovery and they brought suit for a declaratory judgment of the 

parties' rights. The court granted Mutual Services's motion for 

summary judgment stating that the company would not have to 

indemnify McGehee. 

On appeal, Mr. McGehee contended that the court could not 

grant summary judgment to the insurer because there was a factual 

question regarding whether he intended the specific injuries 

sustained by the victim. In denying insurance coverage in that 

instance, the Court stated: 

[Tlhe act of striking another in the face is one which we 

recognize as an act so certain to cause a particular kind 

of harm that we can say a person who performed the act 

intended the resulting harm, and his statement to the 

contrary does nothing to refute that rule of law. 

(Citations omitted.) 

McGehee at 307, 711 P. 2d at 828. See also, Transamerica Ins. Group 

v. Meere, (Ariz. 1984), 694 P.2d 181. 

The course of conduct pursued by Mr. Neilsen included acts 

such as hitting, biting and kicking directed toward those who were 
trying to restrain him. We agree that such acts are similar to the 

blows struck by Mr. McGehee and are certain to cause harm of some 

kind, and can cause serious injury. These types of action are per 

se intentional and the intent to seriously injure is evident from 

the commission and type or nature of the act itself. 

Such actions cannot be the basis for policy coverage without 

vitiating the purpose of insurance. I1[I]f a single insured is 

allowed through intentional or reckless acts to consciously control 

risks covered by policy, the central concept of insurance is 

violated." (Emphasis original.) TransAmerica at 186. The 

exclusion clause, excluding acts which are not "accidental" 

developed to ensure that in standard insurance policies, insurance 

companies would pay damages for "accidents" only. 

We determined the applicability of this exclusion clause under 

general liability insurance policies by using a two-pronged test in 

Strecker. Strecker at 481, 798 P.2d at 132. If either prong of 

this test is satisfied, the acts at issue fall within the exclusion 

provision and are not covered under the policy. I1The first prong 

is satisfied if the injury was not caused by an accident. The 

second prong is satisfied if the injury was either expected or 

intended from the standpoint of the insured." Emphasis original. 

Strecker at 481, 798 P.2d at 132. 

In Strecker, a father attempted to invoke his insurance 

policy's coverage when his daughter filed a civil action against 

him because he had sexually molested her for 10 years. We 
concluded that such conduct was intentional and the intent to 

injure was present regardless of protestations to the contrary. 

The exclusion clause applied and coverage was precluded. 

If we apply the Strecker test to our conclusion that Neilsenvs 

acts were intentional and evince an intent to injure by their very 

nature, both prongs of the test are satisfied. Therefore, the 

exclusion clause applies and coverage is precluded under Neilsen's 

American States insurance policy. Summary judgment was properly 

granted. 

11 

Did the District Court err in concluding that Neilsen had the 

burden of proving the reasonableness of the settlements with 

Wilfoughby and Geering? 

By reason of our above coverage decision, this issue is moot. 

AFFIRMED. 

We Concur: